Skip to main content

tv   Power Lunch  CNBC  November 6, 2019 2:00pm-3:00pm EST

2:00 pm
kim kardashian had this to say >> a location more for privacy, but as far as mental health, it's something that, you know, i think taking the likes away and taking the aspect away from it would be beneficial for people i know the instagram team has been having lots of inner conversations with people to get everyone's take on that, they're taking it seriously and that makes me happy >> do you read all your comments >> i do not. but i find myself to be -- >> wow i need a screen shot that does it for the exchange. power lunch starts right now joe, nice to have you in the afternoon with us. welcome, everybody here's what's new at 2:00 on power lunch. uber unlocked. shares hitting a record low. we will hear from an early investor about whether or not he is holding on for the ride
2:01 pm
plus, there are fewer than 50 days until christmas and wall street is concerned about a retail apocalypse. we have the details about that, and later, it's been choppy waters for royal caribbean the stock is cruising higher the ce will be here for an exclusive interview. power lunch starts right now >> welcome toll power lunch. i'm melissa lee. the major averages are recovering somewhat after falling in the red on reports of a delayed trade deal we have the dow and the s&p 500 marginally higher right now. the nasdaq is down by a third of a% the russell taking it the hardest. let's get over to bob pisani for more >> there's been reports there's no clear deal yet over the terms of a phase one deal with china, or even whether president xi is
2:02 pm
going to come to the table on the deal industrials, there's your classic one, caterpillar, 3-m, united technologies, they're all down a bit today some of the semiconductors like micron also a little weaker as you mentioned, coming off their lows we had a buildup in crude. oil stocks were already weak they had a 5% rally in the past few days, that's helped a lot for the market overall out of favor consumer stocks, tyson, smuckers, colgate, kimberly clark, you see all higher today >> let's call this a pause in the rotation, consumer staples were strong in the middle of the year, and they're well off their highs. remember the old market leaders, starbucks, mcdonald's disney, nike those stocks have been down 6, 7, 8, 9% >> robert and whether you want to believe it or not the countdown to christmas is
2:03 pm
on 49 days to go, and ubs is out with a bit of a holiday warning saying the online takeover may leave many malls empty this season also with us is liz dunn, founder and ceo of pro form ma since you wrote the report, you get to go first. this is a story we've heard before, it's going to be the end of mall retail, the end of department stores and yet a plucky few seem to persist >> we're not saying it's the end of malls, right? we're going to continue to see consumers spend more of their christmas dollars online the disruption we've seen, we haven't reached equilibrium between stores and online. you see pressure on companies that are really dependent on brick and mortar retail. >> are there some retail stores, physical stores that are going to do better than others in your
2:04 pm
view, and what are the differentiators between the ones that will and the ones that won't? >> i think the stores that can offer some unique experience, that you can't get online. if you've been to the nike store on fifth avenue. it's a tremendous experience, you can try things and see things and learn about the product in a new way use your hands and touch things, you can't do that online those types of stores that you can't replicate online, are going to have more success >> liz, you look to a pretty good retail season >> i don't disagree the mall is not a place to be. most of the retailers are under significant pressure you have to have product, service, value and experience. and many of the mall retailers don't have anything differentiated on that front i think there are some brick and mortar retailers that are going to do quite well >> lit me guess, that would be a target that would be a walmart
2:05 pm
that mighting a tjx? >> yeah, target and malwart between their online and offline presence and that multichannel experience they keep pushing the offer, the type of things they're offering now in -- walmart's offering a subscription for grocery delivery things like that, you can get things same day, next day and then tjx is really value end product. not so much the multichannel integration. >> a lot of maloperators are looking to put in things like gyms and sing mas. >> is that going to help at all? you yourself in your report said that a lot of people are going to the malls for the food court. they get hungry, maybe they'll pick something up at the same time >> that's the idea, as long as you can get people to the mall they're going to buy something people buy things because they're there. they may not have planned on it. what we see in our research, people do want to have things to
2:06 pm
do, they might want to go to the food court they might just want to hang out with their friends, that's what they're saying if a mall can come up with ways to bring people together, whether it's a gym or some type of activity that draws them in, that's a good thing. >> i'd like to get both of your takes on this american dream experience mall up near the meadowlands or what's now known as met life stadium. which is ultimately an amusement park that has some stores att h attached to it >> you got it right. people are talking about this american dream it's about 4 million square feet it's not really a mall think of it as universal studios with super high end stores. it's the kind of place when you walk in you're going to say wow. i've never seen anything like this >> you've been in it >> yes >> any retail destination that can do that, they're going to have suck sis. not a lot of malls have that wow factor when you walk in. this place does.
2:07 pm
>> i would say the last thing new jersey needs is another mall but this is not another mall new jersey is the most overmalled state in the country. this is an experience, and it's really about driving people to the destination. i was talking to a retailer last week that said they have a store at disney world i believe that does $10,000 per square foot, which is phenomenal and multiple of any other store they have it's that kind of thing, if you can get people in this engaged experience where there's product that's relevant, you know, maybe they'll transact but it's not going to increase the overall spend in new jersey malldom it's going to come from somewhere else >> i want to get your take on the reuters report the offer was previously reported at $120 a share they're going to ask for 140 is that realistic? i mean, do you think that they
2:08 pm
would be willing to bite >> i hadn't heard the 140 yet, i had heard that they rejected the 120. i think the stock where it traded immediately when this was announced showed that the market believes that the company is worth more and i think that lmh -- the deal makes sense, they should raise their offer. i can't say if 140 is the right number, but 120 was too low. >> we're going to leave it there, guys. i have a feeling we'll see both of you between now and christmas. >> at least in the next 48 days. >> thank you very much we have a news alert on facebook >> facebook has been investig e investigated by california's attorney general's office for 18 months right now california's ag javier becerra is holding a briefing, he said in a fileding earlier today, facebook has failed to comply with its subpoenas.
2:09 pm
those include practices around privacy, disclosures and third party access to user data, the ag's office looking to understand whether the company has violated any laws. they're asking the san francisco superior court to require facebook to comply with its subpoenas for additional documents. we have reached out to facebook for comment. and have not heard back yet. you see here that that press briefing is ongoing, facebook shares trading down at 1%. >> is this part of the investigation, julia where there are multiple state ag's joining together? >> this is separate. there are i believe 47 state ag's who have joined together for an investigation into facebook california was not part of that, the california attorney generals have been asked if they were participating. they said no comment and now we are learning that the california attorney general has been looking into facebook's business practices for 18 months now. and he just said in this press
2:10 pm
briefing, the reason why he's talking about it now is because facebook has not complied with their request for data and now they're looking to get facebook to be effectively forced to hand over those documents they're looking for. >> keep us posted. thank you, julia borstyn a number of big names are sitting out the rally, is it time to start buying the laggards. shares of uber sinking to a record low today we'll talk to an early investor ouwh hs innext giving one. this is unbelievable! >>it really is. the lexus december to rembember sales event lease the 2020 rx 350 all wheel drive for $419 a month for 27 months. experience amazing at your lexus dealer.
2:11 pm
2:12 pm
that's why xfinity mobile lets you design your own data. you can share 1, 3, or 10 gigs of data between lines. mix in lines of unlimited, and switch it up at anytime. all with millions of secure wifi hotspots... and the best lte everywhere else. it's a different kind of wireless network designed to save you money. switch and save up to four hundred dollars a year on your wireless bill. and save even more when you bring your own phone and upgraded your network. that's simple, easy, awesome. click, call or visit a store today.
2:13 pm
today marks the first day investors can sell their shares in uber. uber just one of this year's many high profile companies under water since its public debut. have these unicorns turned into donkeys? not all unicorns or donkey-corns are created equal. there's wework it went from 47 b to 7.8 billion. the force behind some of today's biggest unicorns led to soft bank's first quarterly loss in
2:14 pm
14 years higher on the spectrum is uber at deal book today the ceo made sure to say we're very different than wework. it's another bet that has gone from $76 billion valuation, to $45 billion in the public market we asked the ceo, what's happened to the unicorns >> everything going on around us, the global landscape, has fundamentally changed over the past two years i think the appetite for the unknown and high risk and public markets has gone down. that has consequences. >> now, others may argue that markets have been good to some unicorns there are others on the other
2:15 pm
end 69 spectrum. also a deal book start-ups that are profitable or closer to the benchmark with more solid business models they may look less like donkeys and more like unicorns air bnbp will be an important marker for that. should the early investors take their gains and run or does uber have a prosperous road ahead let's ask one. steve jiang, great to have you with us. did you sell any shares of uber today? >> no, i did not >> do you plan on selling them >> i'm excited for the long term >> long term >> with any sort of early venture, capital investment, there's always the distribution schedule there's always a diversification schedule after going public. that's pretty normal for all investors, and so i think myself
2:16 pm
and other investors will constantly do that over time but i think this would be not a good time to do that i think that the stock is undervalued. i think the company went public in an environment where there was a lot of macro issues as well as -- an argument between private tech markets, investor markets. i think the valuation argument is still playing out on the other side. looking at the company itself, it's going through a right of passage. once you go public there's a fitness on what the market wants. to understand the business and model it out and really get into the details, and there's also a lockup expiration all these things are normal things that happen to public companies like facebook or twitter. you're seeing that play out now. >> why do you think there's a disconnect between what private investors were willing to hear in terms of the information, the
2:17 pm
metrics, et cetera and what the public market investors wanted why was there a gap? >> i think that in the private markets we had an influx of venture capital coming from a lot of late stage or even some public institutional capital i think in that mind-set there was an idea that you could do sort of a pseudo ipo at these late stages and i think valuations were -- the entire market was optimistic and aggressive about it. i think the macro climate changed this year, especially this summer with all companies across tech getting hit. i think there's been a public opinion sway about really scrutinizing what are these public tech companies. in the midst of all of the social, political and economic upheaval in the markets, private valuations from last year or the
2:18 pm
year before that compared to public market valuations this year, there's a disconnect i think that's going to get played out and that's going to normalize like it does in the markets. and i think uber is going to be a company to watch there and they're doing the right thing. and i think in this last earning's call, they showed more metrics so that each business unit could be understood they're issuing 30% year over year growth. the company is growing in a healthy way. they're making the most comprehensive investment in new technologies such as uber elevate. uber freight, uber health. and they have the largest international expanse in terms of market share. they have significant investment in didi and grab in southeast asia they're the large global network in ride sharing as well as customer base. i'm holding for the long term.
2:19 pm
>> quick question if i might has what's happened to some of these former unicorns, is it going to change the appetite for these companies to go public why would they do it if they hit a banana peel when they do >> i think it's hard to predict what the overall global market will be doing. we at ventures, we invest so early as the first institutional fun money start-ups. a lot of these things play out over 8 to 15 years when you're ready, you're ready. when you need to go public because of shareholder frameworks and the capital needed and the ability to create liquidity for your investors, you just -- you should be able to be in the fitness as a company to go public regardless of those markets
2:20 pm
there's some educations -- the lessons learned might be -- figure out what the metrics are that the market wants in the public markets before going public some of the other things too, may be look at direct listings in situations where you may not need a large sum of capitol up front. uber did the right thing in doing an ipo, now they have 12.7 billion in cash investments. they're also the leader there zblo globally to be able to do that >> i think a lot of new factors from this year are going into the thought process in an ipo. >> love that blue bottle of coffee i had one across the street from where you're sitting >> one of our portfolio investme investments. >> it's good coffee. thank you very much. winnebago is holding an investor conference in new york. frank holland is there
2:21 pm
>> hey there winnebago is known for its mobil homes like this. they recorded a record profit, the driver of all that was towables like these over here. we're going to hear from the ceo of winnebago about the company's stock succs d nser enngesancoum someone i can trust. (impact, click) who is with me for the long-term. who understands i'm dealing with lives, not only livelihoods. that in order to help people, i need more than products, i need quality support and insights. can i find someone who partners with me to achieve people's long-term success? with capital group, i can. talk to your advisor or consultant for investment risks and information. talk to your advisor or consultant their medicare options...ere people go to learn about before they're on medicare. come on in. you're turning 65 soon? yep. and you're retiring at 67?
2:22 pm
that's the plan! well, you've come to the right place. it's also a great time to learn about an aarp medicare supplement insurance plan, insured by unitedhealthcare insurance company. here's why... medicare part b doesn't pay for everything. only about 80% of your medical costs. this part is up to you... yeah, everyone's a little surprised to learn that one. a medicare supplement plan helps pay for some of what medicare doesn't. that could help cut down on those out-of-your-pocket medical costs. call unitedhealthcare insurance company today... to request this free, and very helpful, decision guide. and learn about the only medicare supplement plans endorsed by aarp. selected for meeting their high standards of quality and service. this type of plan lets you say "yes" to any doctor or hospital that accepts medicare patients. there are no networks or referrals to worry about. do you accept medicare patients?
2:23 pm
i sure do! see? you're able to stick with him. like to travel? this kind of plan goes with you anywhere you travel in the country. so go ahead, spend winter somewhere warm. if you're turning 65 soon or over 65 and planning to retire, find out more about the plans that live up to their name. thumbs up to that! remember, the time to prepare is before you go on medicare! don't wait. get started today. call unitedhealthcare and ask for your free decision guide. learn more about aarp medicare supplement plan options and rates to fit your needs oh, and happy birthday... or retirement... in advance.
2:24 pm
here's a winnebago frank is at the company's investor day in new york city. had a chance to speak with the winnebago ceo. frank? >> that's salutely right >> shares rising more than 1% this year. the company reporting record profit slumping 18% the company's higher margin lower priced towables. those have really been the driver reporting 6% growth winnebago holding its investor day here showing off the latest models we also spoke to ceo michael happy. he says the company's 2019 performance shows that recession fears are likely overblown >> the weight of the american economy seems to be now a little bit disproportionately on the shoulders of the american
2:25 pm
consumer i think some businesses and manufacturing environments have slowed here recently the american consumer continues to spend we're a consumer discretionary company, we have to earn their spend. so i think not only is there a secular strong argument for outdoor businesses but in the short term, consumers are continuing to spend money. >> he's very encouraged about 2020 sales due in part to the fed cutting interest rates three times this year. he says he also looks at consumer spending and consumer confidence as economic indicators with the rv industry expected to see a third year of decline in 2020. we asked him if rv sales are a reliable economic indicator. he smiled and said, at least not in recent months ahead on power lunch the wealth on elizabeth warren we'll bring you the latest
2:26 pm
details on that. plus, shares of royal caribbean navigating some choppy waters. the ceo joins us for an exuse teiewh per lunch returns. ♪ ♪ ♪ ♪ ♪ ♪ ♪
2:27 pm
by the way, she's the it wasnext mozart.g day. as usual we were behind schedule. but sophie's enthusiasm cannot be dampened. not even by a run-away donut. we powered through it in our toyota prius. because a star's got to shine, no matter what. it's unbelievable what you can do in the prius. toyota let's go places. whether you're or here on a wifi hotspot.
2:28 pm
xfinity mobile has more coverage to keep you connected to what matters most. that's because it's the only wireless network that automatically connects you to millions of secure wifi hotspots and the best lte everywhere else. switch now and see how you could save up to $400 a year. and get 50% off when you buy any new lg phone. xfinity mobile. click, call or visit a store today.
2:29 pm
welcome back, everyone, i'm sue herb aerherera lindsey graham is calling for the identity of the whistle blower claiming it would not put him at risk. >> the statute is being abused it doesn't give you anonymity, nobody should be prosecuted based on an anonymous accusation impeachment is the political death penalty. >> walmart is expanding its grocery delivery service you can pay a yearly fee or monthly. it will be available in more than 50% of the country by the end of the year. there's some new research showing that insured americans are paying more for behavioral health services than other medical conditions the study of nearly 4 million
2:30 pm
people of mebtal health or substance abuse disorders were more likely to have out of network care or pay more out of pocket per year compared with those with chronic health conditions you are up to date ty, back to you. >> thank you very much fair amount of red on the screen there with the exception of the s&p which is basically just flat so is the dow down five almost six points nasdaq with a steeper loss the russell 2000 down about a half%. >> we have a lot of power movers today. starting with the blast to the past xerox making a cash and stock offer to make hpq. the companies could save more than $2 billion in expenses if they merge both stocks are higher now next up, coty the beauty
2:31 pm
brand is pointing to amazon as their key catalyst. diamondback energy down 14%. the company reporting disappointing results. markets are hovering just below record highs here. dom got a look at the sector. >> the good and the bad in this kind of situation, melissa, as we made this run toward record highs over the course of the last month in the broader market and the s&p 500, there are three or four sectors that have been leading the way. one of those sectors is the industrial side of things. you can see on a one month basis. a healthy move higher, but it's not all candy and roses. if you look at some of the defense contractors it's down about 7% during that same span and lockheed which is down 2%. that's a reversal. these stocks had helped lead the way higher for much of the last year or two. a strong component but they're
2:32 pm
not participating in a run toward these regular highs one more sector to watch here is what's happening overall with the technology of financials take a look at that. the breast performing secreta--g sector over the past month the parent company of the nyse, also, cme group down 7%. down 3% for intercontinental they are not participating for us, because the lack of volat e volatility in the markets since we grind higher is playing out there. one more place to watch is technology another top performing sector there, some of those stocks like payment companies, like pay pal, mastercard and visa. >> thank you very much for more on the great rotation and what it may mean for your money, let's bring in chief investment strategist at janney montgomery scott he manages more than 2 trillion. michael joins us from the schwab
2:33 pm
impact conference out in san diego. welcome to both of you mark, you're pretty positive on the market if i had some incremental money, that i wanted to put away with a -- let's say 1 to 3 year time frame, where would you put it now? >> a couple of the sectors that were mentioned, we're shifting our asset allocations into it, and away from the defense of sectors. financials, materials, energy. we think what we're starting to see is a rotation that's legitimate this time unlike the last couple times around, over the last few years, in which it was a one month wonder the legitimacy is being born out by the global economic positions. the readings coming out or the chinese purchasing manager are indicative of stability occurring in overseas markets which is going to go a long way toward one big trade some softening in the dollar and improvement in multinationals. particularly those more heavily geared toward foreign markets
2:34 pm
versus domestic. >> michael, let me ask you to chime in here, it seems like you overlap in your preference right now for what i call cyclicals, including financials and others. >> although the economy continues to desell rate and corporate profits have been falling. i think it's important to have sectors of the market to demonstrate very solid growth. we continue to like the technology sector, the communications services sector i think you need to begin to balance that with some secretariesers that have been out of favor this year and are starting to respond now. for me, i like health care and financials we're going through what's been a fairly sluggish earnings quarter, and health care has been the stalwart. they've done a fantastic job in terms of revenue growth, earnings per share growth. it's an inexpensive asset and it has some long term structural tail winds going-forward
2:35 pm
>> i wonder if you think the market is pricing in a lot this week in terms of -- are the markets discounting the signing of the phase one trade deal they're discounting the fed on the sidelines. the bar is so high for them to move onraits either up or down at some point. and we've already got earnings in the books i ask you this, because once that phase one trade dealis signed, what happens >> i think you're right, i think the market has pulled forward on good news on both fronts certainly on the trade deal. the phase one is intended to be a down payment to be a much broader negotiation. we know the difficult issues, the structural issues are yet to be grappled with, and will take much more than the next year if ever to fully resolve. >> in addition to that, i think earnings expectations on a year over year basis, that is 2020 over this year are expected to be up, according to facts at 8.7%
2:36 pm
that doesn't seem unreason will to me, given global growth expectations that we hold for 2020 therefore i think the market can continue to advance upon the realization of those earnings. this year the story has been about market multiple expansion in the way of earnings contributing to the gains that have been had so far a lot of heavy lifting is going to have to be done by the earnings picture next year the market is valued at 17.4 times forward. it doesn't mean the advance will continue >> michael we have a lot of political winds blowing these days not just on china and trade. but obviously, with the election coming in 2020 a lot of people in jobs like yours are wary about whom the democrats might nominate does one candidate on the democratic side worry you more
2:37 pm
than any others? >> i think over arching concerns about the election always get a little overblown next year it would be a similar scenario to 2016, where the market largely treaded water until we got collarity on the election but tyler, i do think if a progressive democrat were to win the presidency, the markets would sell off that's not a political opinion i think similar to what we saw in the aftermath of trump's election, markets celebrated on the idea that under a republican you would have lower taxes, less regulation, and a more business friendly environment i think under a progressive democrat, the corollary would be you woe have higher taxes and slower growth. i think the markets would react negativitily to a progressive democrat that would leave you with sanders and warren with concerns on the market going-forward. >> thank you very much
2:38 pm
>> enjoy let's get a check on the bond market right now. rick santelli is tracking all the action >> we've had three strong up days in yield, down days in price. today, after the weak productivity numbers, first negative number since the end of 2015, markets are melting a bit. but that selloff certainly helped build demand for today's ten year auction which went really well. you see the resistance there in the mid 180s, and finally the dollar index has been mostly down side since the 2% drop in october. you see, it is crawling back on this week and a half chart, back up to that 98 level, it will be a very important test to see if we can jump over that level and close over that level this week. tyler, back to you >> all right, mr. santelli thank you very much. elizabeth warren's war on att th has a hidden bombshell. wh iis and what it means for markets, next.
2:39 pm
♪ ♪ not much, how about you? >>are you answering my text in person? i am...yeah. >>lol. come on in. this is tech that helps you be there. the nissan altima. now offering the most tech-advanced engine in its class.
2:40 pm
woi felt completely helpless.hed most tech-adonline. my entire career and business were in jeopardy. i called reputation defender. vo: take control of your online reputation. get your free reputation report card at reputationdefender.com. find out your online reputation today and let the experts help you repair it. woman: they were able to restore my good name. vo: visit reputationdefender.com or call 1-877-866-8555.
2:41 pm
you should be mad your neighbor always wants to hang out. and you should be mad your smart fridge is unnecessarily complicated. make ice. making ice. but you're not mad because you have e*trade which isn't complicated. their tools make trading quicker and simpler so you can take on the markets with confidence. don't get mad get e*trade and start trading commission free today.
2:42 pm
welcome back to power lunch, elizabeth warren continues to butt heads with billionaires leon cooperman and jaime dimon sounding off for vilifying wealthy people why this tax may not work like politicians hope it will >> we all agree that we need a better infrastructure for our country. we all agree that we want more into our educational system. we want more with people for opportunity. there's nobody even the wealthiest person in america doesn't think that's a bad idea i think the bad idea comes in when you start to create this line in the sand when you start to decide who's going to get tax and who's not. >> today the line's at -- if you have $50 billion or $5 billion tomorrow it's going to be a million. at the end of the day, myself and other people that have had hard work and callous on our hands, don't want to be told how
2:43 pm
to reinvest into the marketplace. >> now warren is fighting back against those billionaires robert frank is here with the latest >> it is the daily back and forth now. it just gets better, the push back from billionaires and ceo's is music to warren's ears. the fact that they've reacted so strongly, so angrily tells you all the you need to know the system is working for the wealthy and well connected and jaime dimon doesn't want that to change the wealthy taxing unrealized. right now you only pay a tax on the gain of a stock sale of an asset if you sell it warren would tax the gain on that asset or stock every year, even if you don't sell it. if you own 100 shares of apple, your gain would be $15,000 you would pay a tax of $00 this year, even if you never
2:44 pm
sell a single share. you can use losses to offset future taxes, it would exclude retirement accounts, ultramillionaires and billionaires won't be able to earn income on giant fortunes year after year without ever paying a penny in taxes. >> this is on top of the wealth tax, which is her tax of 2 to 6% of wealth. 2 to 6% of wealth, plus all your unrealized capital gains would get taxed at %. >> does that unrealized capital gains tax apply only after a person's income exceeds a certain amount. >> it only applies to what she says the 1%. right now the income threshold is around $450,000 for a family. if you make less than that and it's part of your retirement account you're excluded from this tax any household making any more than 450 a year would have to pay this tax >> there are so many -- i don't even know where to start
2:45 pm
>> yes >> i would think that some families would have to sell their stock in order to pay the tax? >> precisely, what's interesting also, not that we should feel sorry for jeff bezos and people like that, founders would have to sell 6% of the stock to pay the wealth tax imagine any gain, in bill gates' case is like 20 billion a year beyond what you already sold so you would lose control of your company possibly within 15 years or so. just paying these taxes. >> what happens in one year if the markets are down and you have a loss? >> she has a plan for that the planning is tax you. if you declare -- if you pay taxes one year and the stock is down the next year, you can carry that loss forward, but you don't get the money back that you paid the previous year >> what if i have a gain on the stock? i bought it at 50. now it's at -- it lost 25.
2:46 pm
it's at 75 i still have a $25 gain. >> on the basis. you're right >>. >> what happens if you bought shares in different lots >> that's why this is a nightmare. >> the full employment act for accountants is what this really is it's baffling. and so -- >> mutual fund shares and -- >> this tax alone, she needed what, 20 or $30 trillion for medicare this piece of it alone is over $2 trillion in revenue, and that's why she's putting it in there. >> robert? >> thank you >> i think we'll be hearing more from you about this. >> every day royal caribbean reporting weaker than expected earnings and lowering guidance. taking a hit from hurricane dorian, shares initially sank, but have already recouped those losses climbing about 3% in the past week up next, the ceo will join us to teieuse in an excliv inrvw.
2:47 pm
so what are you working on? >>i'm searching for info on options trading, and look, it feels like i'm just wasting time. wasted time is wasted opportunity. >>exactly. that's why td ameritrade designed a first-of-its-kind, personalized education center. see, you just >>oh, this is easy. yeah, and that's >>oh, just what i need. courses on options trading, webcasts, tutorials. yeah. their award-winning content is tailored to fit your investing goals and interests. and it learns with you, so as you become smarter, so do its recommendations. >>so it's like my streaming service. well exactly. well except now, you're binge learning. >>oh, i like that. thank you, i just came up with that. >>you're funny. learn fast with the td ameritrade education center. call 866-296-7451 or visit tdameritrade.com/learn.
2:48 pm
get started today, and for a limited time, get up to $800 when you open and fund an account. that's 866-296-7451, or tdameritrade.com/learn. ♪
2:49 pm
the amount of student loan debt i have, i'm embarrassed to even say. we just decided we didn't want debt any longer. ♪ i didn't realize how easy investing could be. i'm picking companies that i believe in. ♪ i think sofi money is amazing. ♪ thank you sofi. sofi thank you, we love you. ♪ 2019 -- we'll get to you in a minute he's chatting away because we're
2:50 pm
having a good conversation shares of trip adviser sinking more than 24%. both companies are set to report after the bell >> welcome >> earnings so far from some of the major travel operators suggest that consumers are becoming a bit more conscientious on how much they're willing to spend on leisure trips. at the same time there are these structural changes at play growing demand for rentals begins to challenge the hotels like march yol like marriott, hyatt and the bl royal caribbean reported earnings and lowered its full-year guidance due to hurricane dorian which damaged parts of the caribbean and bahamas. royal, along with other cruise stocks, have come under pressure in the last six months if the economy does continue to soften, cruises could thrive because they have more
2:51 pm
cost-effective options. >> seema, stay right here. we want to dig deeper into royal caribbean. joining us aboard, chairman and ceo of royal caribbean cruises richard, great to have you in house and in person. >> thank you for having me some people were a little put off by the quote that you highlighted certain changes in your cost base, revenue-enhancing investments in 2020 what sort of enhancements, investments are these? >> we have three priorities. they are people, destinations and technology and we are investing in all three of them. the most recent example is our perfect day cococay, our private island we spent, for example, four years preparing for the new private island, the technology
2:52 pm
is coming on stream. there's a short-term cost but the payoffs have been, i would say, delicious. >> coco cay is seen as a big driver for bookings during this upcoming wave season and some are saying they expect 65% will be booked by the end of wave season which ends the end of first quarter. does that 65% sound right to you? >> we are seeing a lot more bookings in advance, and people are booking further in advance i think that's a sign of strength in the industry we haven't given out those numbers, but that's the kind of number we've seen in the past. and the last two years we've seen record bookings as we end the year and i think this year we will again. >> one of the benefits of cruising is you can truly customize the experience from the type of room you want to stay in, food and beverage, whether you want to participate in on or off-board experiences have you seen any sign that consumers are opting for the basic room versus luxury, pulling back how much they want
2:53 pm
to spend when they're on board >> not yet actually. on the contrary, we're seeing more demand for the better staterooms we've upgraded our categories so we have more in-suites, more with verandas and those are actually selling first now you try to get one of our top royal suites in advance, a year in advance, a year and a half in advance and it's difficult to get the very best cabins i think it's really because cruising has come of age and people are seeing cruising as a great value. we think that's why so many analysts are talking about us being recession resistant. and it's paying off. we're seeing it at great strength in america, great strength in china. europe isn't as strong as we expected but our pricing in europe is still better than it was last year. i can live with this kind of bad news every day. >> how much did hurricane dorian cost you and why was it such an expensive storm? >> hurricane dorian was a terrible storm it cost us about 15 cents a
2:54 pm
share. and that's a lot of money. >> how many cruises did you have to cancel? >> we only had to cancel one, but we had to reposition we have to stay way away from the storm. >> right. >> we do a lot of things from a precautionary point of view. we also had to close down perfect day for ten days we had to cancel or move 16 sailings it affected 88,000 of our guests in our 30-year -- in our 50-year history it's our most impactful storm we've ever had the reason was it had some very unique characteristics, including the fact that it just -- >> sat there. >> sat there 38 hours over freeport it must have been horrible to be there. so, it affected that it affect ed some of our best ships, oasis class ships and perfect day island and lastly, we invested a great deal in trying to give back a little bit to the bahamas. so there was a fairly big expense in terms of relief.
2:55 pm
>> are you back in business in those destinations. >> absolutely back in business and the destinations are fine. i have to say people forget how big the bahamas are. the chain is 700 islands it's longer than california. and a couple of islands were affected it's absolutely back in business. >> but is it time to maybe invest in other regions, given that hurricanes are a recurring theme and, therefore, a threat to your business >> well, hurricanes are an issue. but we are investing in other areas. so our investment in china has been some of the largest we've ever done. just last week we announced a new investment in a perfect day in vanuatu off the coast of australia, we're investing in europe we're becoming, every day, more and more of a global company that's proven to be a very successful formula for us and diversifies our business when we do have something, it's a hiccup rather than a real blow. >> just to understand the advanced bookings, you're saying people are booking more and more in advance
2:56 pm
what is the percentage of the people who actually stay with that trip that they booked and take it? >> if somebody books, even if they put $5 down, the cancellation rate is very, very small. >> really? >> people make their decisions they're cautious about making their decisions and we say generally at any point in time about half of the next 12 months is booked. more recently it's been a little better than that, because people have been booking a little further out. but once somebody is booked, they tend to have really thought about it and tend not to change that. >> richard, great to see you and r anouthks to seema mody "check please" is next only one thing's more exciting than getting a lexus... wow! giving one. how did you guys...? >>don't ask.
2:57 pm
the lexus december to rembember sales event get 0 percent apr for 60 months on all 2019 models. experience amazing at your lexus dealer. man: how can i deliver superior long-term results? it begins with a distinctive approach to managing money. that for over 85 years has focused on keeping confidence up when markets are down. an approach where portfolio managers work well independently. and even better together. who don't just invest, but are personally invested. can i find a proven approach designed to deliver results? with capital group, i can. talk to your advisor or consultant for investment risks and information.
2:58 pm
talk to your advisor or consultant when i lost my sight, my biggest fear was losing my independence. mmm... good. so i've spent my life developing technology to help the visually impaired. we are so good. we built a guide that uses ibm watson... to help the blind. it is already working in cities like tokyo. my dream is to help millions more people like me.
2:59 pm
facebook has put out a statement into the ongoing conversation into the company which we reported on earlier this hour. >> responding to california's attorney general, revealing its 18-month investigation at the company and it's asking the san francisco superior court to require facebook to comply with the subpoenas after the company failed to comply but facebook saying just now, quote, we have cooperated extensively with the state of california's investigation to date, we have provided thousands of pages of written responses and hundreds of thousands of documents right now, facebook shares are trading down around 1.3% melissa, back over to you. >> julia, thank you very much. i want to call your attention to shares of tesla, moving higher
3:00 pm
to session highs up by more than 2% s&p advising the rating on tesla to a positive from a negative. something to watch into the close here. >> always a good stock to watch. even on a day where the major averages are pretty calm. >> thanks for watching "power. >> "closing bell" starts right now. yes, it does welcome to the "closing bell," everyone i'm wilfred frost. uber, comments from the ceo coming up. dow down six points. 59 minutes left of trade. >> i'm morgan brennan in for sarah eisen. reports of a possible delay in the signing of a phase one deal. data taking a bearish turn as u.s. productivity dropped for the first time on a quarterly otsis since 2015 and one bright

20 Views

info Stream Only

Uploaded by TV Archive on